Croatia VAT compliance update
A range of Croatian VAT compliance changes have been introduced recently to update the VAT Law. These include:
VAT on immovable property
The supply of building is to become VAT exempt in accordance with the EU VAT Directive rules on immovable property.
2015 Mini One Stop Shop changes
The changes to the EU VAT Directive on the change in place of supply rules for B2C digital services from 2015 have been adopted. From 1 January, Croatian taxable suppliers of electronic, broadcast or telecoms services to consumers in other EU countries will have to charge their VAT rate rather than the Croatian rate.
Along with Spain, UK and now Greece, Croatia will offer cash-based VAT accounting instead of accruals accounting. This means businesses should pay or charge VAT only when there is a cash / bank settlement of any invoice. Only companies with annual turnover below HRK 3m may apply for the new regime.